There is war in Ukraine. We have sanctions. So why would the UK Treasury help Putin’s brutal ally?

It should never have taken the invasion of Ukraine to force a re-examination of the UK’s easy accommodation of Russian oligarchs’ dirty money. For years ministers have turned a blind eye while London became the haven of choice for many of Putin’s allies. But with the invasion launched there could be no more not asking questions. No more looking the other way.

The purchase of mansions, the laundering of money, the use of expensive legal firms and consultants by allies of Putin and the Russian regime were all brought into stark relief as the Ukrainian army and people fought for their lives and their country.

Sanctions were announced against a number of individuals. British firms pulled out of Russia. Support for Ukraine extended across every political party in the House of Commons. And the arguments and excuses of British apologists for the Russian regime fell on deaf ears.

It is therefore remarkable that a unit in His Majesty’s Treasury has been accused of giving explicit permission to lawyers acting on behalf of Yevgeny Prigozhin, the founder of the Russian mercenary army the Wagner Group. He aimed to silence and intimidate the British journalist Eliot Higgins, founder of the Bellingcat website.

Prigozhin and the Wagner Group are the worst faces of the Russian regime. They act with impunity across the world as mercenaries propping up dictators in Syria, across Africa and beyond. Little wonder that last week the US government announced it would designate the Wagner Group a “transnational criminal organisation”.

It is not hard to see why Bellingcat would have irritated the Russian government and those who serve it. Bellingcat’s reporting has exposed exactly how Malaysian Flight MH17 was shot down over Ukraine and revealed the identities of the Russian agents who targeted the Skripals in Salisbury and were responsible for the death of local resident Dawn Sturgess. The open-source reporting of the website has proved to be a powerful bulwark against fake news and conspiracy theories. For that we owe its journalists a debt of gratitude.

It is therefore remarkable that a unit in the Treasury has been accused of giving explicit permission to lawyers acting on behalf of Prigozhin to pursue a baseless legal action designed to silence Higgins and Bellingcat.

According to the website Open Democracy, the Office of Financial Sanctions Implementation (OFSI) – a unit in the Treasury – granted permission on more than one occasion to Prigozhin’s UK lawyers to pursue the legal action, even though Prigozhin was a sanctioned individual at the time and his CV was well known to the UK authorities. The Treasury even gave his UK lawyers permission to fly to Russia to co-ordinate the legal action with the Wagner founder’s Russian lawyers.

All of this begs serious policy questions if we are to take our own sanctions regime seriously. For months Labour has been calling for oligarchs’ frozen assets to be seized fully and repurposed to support the reconstruction of Ukraine.

In this context, how could the Treasury facilitate a baseless legal action by the head of a Russian private army? Is the government saying that any sanctioned individual can use the UK courts in this way?

How could this have happened when the UK justice secretary promised in parliament last July that: “We will not allow our courts to be abused to censor those brave enough to call out corruption. We will protect our free press, which is there precisely to hold the powerful to account.”

Despite this pledge, how many more sanctioned individuals have been given permission to pursue such actions through the UK courts?

How will the government respond to these revelations? Will any action be taken to ensure this doesn’t happen again? And perhaps most of all, what does being sanctioned actually mean if something like this can happen?

Right now, the Wagner Group is laying siege to Bakhmut, as part of Putin’s war in Ukraine, a war in which the government, the opposition and the people of the UK stand firmly behind Ukraine. The story of how the founder of the Wagner Group was given permission to use the British courts to try to silence his critics should prompt a cold hard look at how the sanctions regime is operating in this country – and a resolve to make sure this never happens again.

  • Pat McFadden is shadow chief secretary to the Treasury

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